XN000022-1982-01-21 — Page 6

THURSDAY, JANUARY 21, 1982

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THE MAIN DEFECT IN THE ECONOMY LAST YEAR, APART FROM THE UNCERTAIN WORLDWIDE TRADING CONDITIONS, WAS INFLATION,

SIR MURRAY SAID.

+AT 15 PER CENT THE RATE OF INCREASE OF CONSUMER PRICES WAS NO LESS THAN IN 1980, HE ADDED.

+ ALTHOUGH WORLD FOOD PRICES HAVE BEEN FAIRLY STABLE, PRICES FOR THE TYPES OF FOOD THAT WE IMPORT INCREASED RAPIDLY, AND IN PARTICULAR THE FRESH FOOD ITEMS.

+MANY FACTORS PRODUCED THE INFLATION OF THE LAST TWO YEARS. SOME WERE IMPORTED AND OUTSIDE OUR CONTROL- SOME, THOUGH DOMESTIC, ELUDED OUR CONTROL.

SIR MURRAY SAID HE REALISED THAT WHILE BRINGING US NEW WEALTH AND NEW INTERNATIONAL STATUS, THE VERY RAPID EXPANSION OF OUR BANKING AND OTHER FINANCIAL SERVICES HAVE ALSO BROUGHT PROBLEMS RELATING TO PRUDENTIAL CONTROL AND BROAD ECONOMIC MANAGEMENT.

HE SAID IT IS HIGHLY DESIRABLE THAT THESE BE SOLVED WITHIN THE FRAMEWORK OF ARRANGEMENTS THAT ARE BROADLY CONSULTATIVE AND COOPERATIVE.

SIR MURRAY SAID THE RE-NEGOTIATION OF THE MFA HAD BEEN A REDOUBTABLE ACHIEVEMENT.

SIR MURRAY SAID HONG KONG IS A MAJOR MARKET IN ITS OWN RIGHT AND A MAJOR ERIDGE TO OTHER MARKETS.

+wE NEVER RESTRICTED ANYONE'S GOODS. WE HAVE NEVER PROTECTED OUR OWN PRODUCERS. WE HAVE NEVER REFUSED RESTRAINT WHEN DAMAGE

WAS FAIRLY PROVED.

+BUT IF COUNTRIES SEEK TO RESTRICT OUR EXPORTS FOR NO BETTER REASON THAN SHORT TERM POLITICAL EXPEDIENCY, THERE IS BOUND TO BE ANGER.

+ IN THIS CASE, THEIR CONTRACTORS AND EXPORTERS SHOULD NOT BE SURPRISED IF THIS WERE TO AFFECT THE CHOICE OF HONG KONG CLIENTS AND BUYERS. THEY WOULD ONLY HAVE THE PROTECTIONIST INTERESTS THAT HAD INFLUENCED THEIR GOVERNMENTS TO THANK, SIR MURRAY SAID.

THE GOVERNOR SAID HE BELIEVES THE BIGGEST OPPORTUNITY FOR HONG KONG AT THE MOMENT IS THAT OFFERED BY THE DEVELOPMENT OF THE MUTUAL COOPERATION WITH GUANGDONG AND OTHER PARTS OF CHINA. +OUR BUSINESSMEN ARE BETTER PLACED TO SEIZED MANY OF THE OPPORTUNITIES THAT EXIST NEAR AT HAND THAN THE MISSIONS AND THE TYCOONS FROM OVERSEAS WHO VISIT BEIJING FOR A FEW DAYS TO DISCUSS VAST PROJECT.+

HOWEVER, HONG KONG WILL ALSO HAVE ITS UNCERTAINTIES, THE GOVERNOR ADDED.

/+WE HAVE